According to Punch News, the governors cited a lack of funds and inadequately allocated increases as reasons for not being able to pay the new wage. This is not about the federal government, as Labour has asserted. “It is the national minimum wage that is being negotiated, not the Federal Government minimum wage for workers,” one governor said.
“The national minimum wage affects states, local governments, and private sector employers, especially small and medium enterprises and MSMEs. The first consideration when negotiating wages is affordability and ability to pay.” Will states, local governments, and private employers be able to afford to pay?
Data on federal allocations to states before and after the removal of subsidies in May 2023 shows that most states saw their allocations increase by 20–25 percent, while others saw their allocations decrease. Lagos State saw an increase of 28 percent, while Anambra, Ondo, Edo, and Imo states saw increases of 16 percent, 3 percent, 4 percent, and 13 percent, respectively. However, Akwa Ibom, Bayelsa, Delta, and Rivers states saw their allocations decrease after the removal of subsidies.
Governor Idris of Kebbi State distanced himself from reluctant governors and said he would pay the agreed-upon minimum wage. “Even if a meeting was held, I was not part of it, and I am not among those who will not pay the agreed minimum wage. I have said in various public forums that I will pay the agreed amount, and I stand by that,” he said.
As the country awaits the president’s decision, it remains to be seen whether states will be able to pay the new wage without resorting to bailouts and layoffs.CONTINUE FULL READING>>>>>
